SoftBank investments have kept Amazon at bay: Masayoshi Son
SoftBank Group Corp chairman Masayoshi Son claimed that the Japanese firm’s investments in the global e-commerce market have been successful in keeping the world’s largest online retailer Amazon.com Inc at bay, and pointed to the recent success of two of the Japanese investor’s biggest bets in India, Flipkart and Paytm, market leaders in their sectors.
In a post-earnings conference call with analysts late on Monday, Son said both Flipkart and Paytm were market leaders by a wide margin in their sectors, citing market share data from various research reports. According to SoftBank, Flipkart has a 60% share in India’s e-commerce market, while Paytm commands a 58% share of India’s digital payments business.
“E-commerce as a business model is now becoming the essential business model for our sociSnapdeal ety,” Son said. “Amazon is still making a loss in e-commerce.”
“Flipkart, India’s number one e-tailer has 60% in the domestic e-commerce market and is bigger than Amazon India. It is very difficult to see someone who is bigger than Amazon. I believe, after China in terms of size, India should be next, and in a market with such huge potential Flipkart has 60% market share which is a good start. In China, Alipay has been successful as a business model and Alipay and SoftBank support Paytm. Again, thanks to the Alibaba Group, we are the second-largest shareholder in Paytm,” added Son.
The latest earnings report from SoftBank was a sharp contrast from last year when the Japanese firm had seen some of its India investments — mainly — go sour and was forced to write down the value of its biggest investments in the country. In November last year, SoftBank had written down as much as 58.1 billion yen ($555 million) in two of its biggest investments in India, cab-hailing firm Ola (ANI Technologies Pvt. Ltd) and online marketplace Snapdeal (Jasper Infotech Pvt. Ltd), the company said. Earlier this year in May, SoftBank had written down the value of its investments in Snapdeal and Ola by $1.4 billion.
In its latest earnings report, SoftBank reported a gain of 10.2 billion yen ($89.3 million) on its India investments, saying the latest numbers were a “recognition of gain in the fair value of investments, primarily in Southeast Asia and India.”
In the one year since Son’s last visit to India, SoftBank has pumped more than $4 billion into the Indian market, taking the Japanese firm’s investments in Indian start-ups to more than $6 billion in less than three years.
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